MUMBAI: Phoenix Mills Ltd, a Mumbai-based real estate developer, is close to acquiring three 30-acre plots in Ahmedabad, Hyderabad and Nashik for close to Rs 800 crore.
A real estate source said the deals are likely to be sealed in the next few weeks. Phoenix Mills plans to develop malls and entertainment zones.
Anand Sundaram, executive director and CEO, Phoenix Mills, “We are looking and acquiring lands for our projects, but we cannot comment on any particular deal. If any deal is sealed, we will inform the exchanges.”
The Phoenix group is developing Market City Projects, spread across 214 lakh square feet, in Mumbai, Bangalore, Chennai, Pune, Raipur, Agra and Indore.
Sundaram said it was a lot tougher in metro cities than in smaller cities. Phoenix has already bought land in Raipur, Indore, Chandigarh, Udaipur, Bhilai, Vadodara, and Kandla, and development has begun in Raipur, Indore, and Agra.
The company is seeking to establish long-term relationships with developers in its bid to achieve a pan-India footprint in three years.
Analysts Sachin Sharma and Akshit Shah of Edelcap said in a recent note to clients that any correction in property prices will adversely affect the company’s profitability and valuation, since Phoenix’ primary source of income is rents.
With a planned development of 54 million sq ft over the next four-five years, Phoenix faces strong execution challenge.
Any delay in the completion of these projects will strain its cash flows and valuation, the report adds.
According to an estimate, the country is all set to have over 500 malls by 2010 from just three malls in 2000. Roughly 300 million sq ft of quality retail space will be accumulated by 2011.
r_mithun@dnaindia.net
